Explore BrainMass
Share

# contribution margin and the break even point

This content was STOLEN from BrainMass.com - View the original, and get the already-completed solution here!

Sales ( 30,000 caps @ \$50)- 1,500,000
Less vairable expenses- 900000
contribution margin- 600000
less fixed expenses- 280000
net income- 320000

Find the contribution margin and the break even point in both units and dollars.

https://brainmass.com/economics/macroeconomics/101930

#### Solution Preview

Contribution margin = Sales - Less variable expenses = 1,500,000 - 900,000 ...

#### Solution Summary

This job finds the contribution margin and the break even point in both units and dollars.

\$2.19

## Contribution margin, break even point, margin safety ratio, fixed costs

Tyson Company bottles and distributes LO-KAL, a fruit drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 70 cents per bottle.

Management estimates the following revenues and costs.

Net sales \$2,500,000 Selling expenses-variable \$ 90,000
Direct materials 360,000 Selling expenses-fixed 200,000